I speak and write about investor protection, money management, health economics, ecology and social issues. My latest book is "Keynes's Way to Wealth," a revealing look inside the successful portfolios of the world's most famous economist. All told, I've written 14 books including The Cul-de-Sac Syndrome and iMoney: Profitable ETF Strategies for Every Investor and write a column for Reuters.com. I speak across the U.S. and my writing also appears in the New York Times, Morningstar.com and other national publications. This blog delves into financial and social deceptions.

Crowdfunding Craziness: How to Protect Yourself From the JOBS Act

Crowd “funding” or crowd “fracking?” The jury’s still out on whether the new JOBS Act will empower the next Steve Jobs or the next Bernie Madoff.

Only a few things are certain. Like past efforts in deregulating the New Deal legacy of investor-protection laws, the JOBS act will be a road to hell paved with good intentions, to paraphrase Dr. Johnson.

When you have nearly every consumer advocate and state regulator warning you not to loosen investor protection laws, it’s almost certain that thousands will be separated from their money via this new law, which was just signed by President Obama and endorsed by both parties. Nevertheless, here’s what the President said in his signing ceremony:

“Here’s what’s going to happen because of this bill. For business owners who want to take their companies to the next level, this bill will make it easier for you to go public. And that’s a big deal because going public is a major step towards expanding and hiring more workers. It’s a big deal for investors as well, because public companies operate with greater oversight and greater transparency.

And for start-ups and small businesses, this bill is a potential game changer. Right now, you can only turn to a limited group of investors — including banks and wealthy individuals — to get funding. Laws that are nearly eight decades old make it impossible for others to invest. But a lot has changed in 80 years, and it’s time our laws did as well. Because of this bill, start-ups and small business will now have access to a big, new pool of potential investors — namely, the American people. For the first time, ordinary Americans will be able to go online and invest in entrepreneurs that they believe in.

Of course, to make sure Americans don’t get taken advantage of, the websites where folks will go to fund all these start-ups and small businesses will be subject to rigorous oversight. The SEC is going to play an important role in implementing this bill. And I’ve directed my administration to keep a close eye as this law goes into effect and to provide me with regular updates.”

Let’s deconstruct this a bit. The SEC, which should have been active in shutting down Madoff, the mortgage securities bubble, policing credit-rating agencies, sniffing out analyst lies, mutual-fund trading swindles and warning about the dot-com blow-up, is unable to keep up with its Dodd-Frank financial reform mandates. How in the heck is it going to be a watchdog over Internet-based start-ups?

House GOP members have thus far been able to tie the SEC up in knots over really essential things like establishing an investor advocate. I called the SEC the other day and asked about this vital new office. The agency hasn’t been able to resolve funding issues.

What about fiduciary responsibility, which would be a key investor protection for anyone selling stock? This would mean any seller of a financial product would have to put their clients’ interests first — or open themselves up to lawsuits. The SEC greenlighted this great idea, only to have it shot down by the GOP, Wall Street and insurance industry, which wants nothing to do with fiduciary duty. Rules are being rewritten to accommodate the financial industry; investors are not being protected at he moment.

What about limiting positions for commodity speculators so that they can’t run up oil and gasoline prices and ignore any connection to supply and demand (which is what’s happening now). As part of Dodd-Frank, the Commodity Futures Trading Commission wrote new rules, but opposition from the GOP and their sponsors running trading desks took the commission to court, where the rules are tied up.

I have a dozen more examples where Wall Street has devoted considerable time, effort and campaign contributions to snuff out financial reform designed to protect the public. It’s been relentless. So do I believe that the SEC or any other agency will offer genuine protection to investors? Don’t take my word for it. Here’s what securities regulators, as represented by the North American Securities Administrators Association (NASAA), stated when the JOBS Act passed:

“The JOBS bill the President signed today is based on faulty premises and will seriously hurt all investors by either eliminating or reducing transparency and investor protections. It will make securities law enforcement much more difficult, said Jack E. Herstein, NASAA President and Assistant Director of the Nebraska Department of Banking & Finance, Bureau of Securities. Investors need to prepare themselves to be bombarded with all manner of offerings and sales pitches. Congress has just released every huckster, scam artist, and small business owner and salesman onto the internet, Herstein added.

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